March 22 (Bloomberg) -- U.S. airlines that can't fly to London's Heathrow Airport, Europe's busiest, welcomed the European Union's decision to relax trans-Atlantic flying rules.

Continental Airlines Inc. said today it filed for the U.S. rights to serve Heathrow and Paris once the ``Open Skies'' agreement takes effect next year. Northwest Airlines Corp. said it wants to expand its alliance with European carriers.

``If this were a game of Monopoly, Heathrow would be like Boardwalk -- it's a piece that makes winning a lot easier,'' Credit Suisse analyst Daniel McKenzie said today in a note to investors. Heathrow is the London airport favored by global business fliers who pay the highest fares, McKenzie said.

Open Skies may provide a lift to U.S. airlines including Continental because only four carriers can make U.S.-Heathrow flights now: AMR Corp.'s American Airlines, UAL Corp.'s United Airlines, British Airways Plc and Virgin Atlantic Airways Ltd.

EU transport ministers approved the agreement today, after the EU and U.S. gave it preliminary backing on March 2. McKenzie, who is based in New York, estimated the value of the trans-Atlantic market to U.S. and EU carriers at $22 billion.

``This is going to level the playing field to some extent,'' said George Hamlin, president of Fairfax, Virginia- based Hamlin Transportation Consulting. ``It's a step in the right direction.''

Continental, Northwest, Delta Air Lines Inc. and US Airways Group Inc. now fly to Gatwick airport, which is 28 miles (45 kilometers) south of London. Heathrow is 15 miles (24 kilometers) west of London.

Continental, Northwest

Heathrow access can mean the difference between an airline winning or losing large corporate travel accounts, McKenzie wrote, and just 1 percent of the market could mean a net $50 million a year for Continental. The Houston-based carrier was the only U.S. airline taking action today on Open Skies.

Without giving a timetable, Northwest said it plans to request a broader antitrust exemption for its SkyTeam alliance with KLM and Air France. An exemption, which was denied last year, would let the carriers work more closely on fares and schedules.

Delta, hoping to fly to Heathrow, is pleased ``EU transport ministers voted unanimously to approve creation of a fully deregulated trans-Atlantic marketplace that will benefit customers,'' spokeswoman Betsy Talton in a statement.

American, United

American and United said they were ready for more competitors at Heathrow and elsewhere.

Open Skies may ``give us the opportunity to cooperate more fully with our partners at other airlines,'' said Tim Smith, a spokesman for American, the world's largest airline. American's Oneworld alliance includes British Airways and Australia's Qantas Airways Ltd.

United Chief Executive Officer Glenn Tilton said in a statement the agreement ``represents a significant step toward much-needed global deregulation.''

US Airways declined to comment.

The new rules, starting March 30, 2008, will allow EU-based airlines to make U.S. flights from any country in the 27-member bloc. Previously, those European airlines could only reach the U.S. from their home countries.

EU carriers can't serve routes entirely within the U.S., and if they make an intermediate U.S. stop en route from Europe to their final U.S. destination, they can't pick up new passengers.

A `Full' Heathrow

Fares may fall as competition rises, though Heathrow is currently ``full up'' and unable to add new flying at times business fliers want to reach London, wrote Credit Suisse's McKenzie.

Carriers now barred from Heathrow may try to acquire landing rights from alliance partners that fly there now, or try to share that access, he said.

American and British Airways, rebuffed twice by regulators in bids for antitrust immunity so they coordinate prices and schedules at Heathrow, may still have a ``tough sell'' to win approval even under Open Skies, said Jon Ash, president of Washington-based consulting firm Intervistas-GA2.

``Combined, they hold such a huge preponderance of market share at Heathrow,'' Ash said in an interview.

Shares of Fort Worth, Texas-based AMR fell $1.54 to $32.66 at 4 p.m. in New York Stock Exchange composite trading. Shares of Houston-based Continental declined $1.60 to $38.90.

Shares of Elk Grove Village, Illinois-based UAL lost $1.77 to $39.70 Nasdaq Stock Market composite trading. Shares of Atlanta-based Delta slid 6 cents to 76 cents in over-the-counter trading. Shares of Northwest, which like Delta is in bankruptcy, fell 1 cent to $1.05.

To contact the reporters on this story: Eric Torbenson in Dallas at etorbenson@bloomberg.net; Mary Schlangenstein in Dallas maryc.s@bloomberg.net

Last Updated: March 22, 2007 17:04 EDT